Chivas Products Ltd. and Johnson Controls Inc. plan to build a $5 million injection molding plant in Detroit to make automotive parts for General Motors Corp. In a Jan. 29 announcement, Milwaukee-based Johnson Controls said its Automotive Systems Group will join in the six-year, $900 million contract with minority-owned Chivas Products of Sterling Heights, Mich. The arrangement includes construction of a 70,000-square-foot plant that will make interior components and systems for model-year 2000 vehicles.
The contract is the largest single business award ever given to a minority-owned source, and is a major advancement in GM's overall minority supplier development initiatives, according to the companies.
Construction on the plant is due to be-gin in early 1998, and could be complete in 1999. The initial cost is estimated at $5 million, and at peak production levels the facility should employ about 140, according to Jeff Steiner, a spokesman for JCI.
Chivas, a privately held firm with $40 million in 1995 annual sales, supplies GM and other North American automakers with interior trim and lighting, plastic and energy-absorbing foam, as well as door panels, seat trim, recyclable child-seat pads, recliner handles, armrest armature, dome lamps, assist straps, moldings and cup holders.
Chivas supplies Johnson Controls, GM, Chrysler, Ford, Mazda and Mitsubishi, among others. Chivas, which has plants in Sterling Heights and Canton, Mich., will have majority ownership interest in the joint venture. The company operates 18 injection molding presses at its Canton facility, and does plastic component assembly at Sterling Heights.
``We will be making more injection molded parts for JCI's seat assemblies with this joint venture,'' Joe Anderson, Chivas chairman and chief executive officer, said in a telephone interview.
``The fact that Johnson makes seats and headliners would also indicate we would be making coat hooks and other head-liner items as well,'' Anderson added.
Johnson Controls is the world's largest supplier of automotive seating and headliners, and a major supplier of interior trim components.
The company's Plymouth, Mich.-based Automotive Systems Group is the largest of four divisions of Milwaukee-based Johnson Controls Inc. and supplied seats for 8.4 million vehicles in 1995.
The Automotive Systems Group achieved sales of $3.8 billion for the 1995 fiscal year, contributing to the $8.3 billion in sales registered by the pa-rent company during the same period.